Marking a major milestone in home entertainment’s shift to digital formats, video streaming subscription revenues surpassed DVD / Blu-ray sales in the United States for the first time in 2016. This trend continued through 2018, when subscription-based streaming accounted for more than half of consumer spending on home entertainment. While U.S. consumers spent $12.9 billion on subscriptions to services such as Netflix
(up 30 percent compared to 2017), DVD and Blu-ray sales dropped another 15 percent last year, with consumer spend amounting to $4.0 billion, according to the Digital Entertainment Group's year-end report
Looking at the home entertainment market as a whole, it is clear that the future of video distribution for home use is digital. While consumer spending on streaming subscriptions and electronic sell-through continued to increase in 2018, all physical formats, both sell-through and rental, suffered double-digit declines. Digital distribution models now account for three quarters of total home entertainment spending and surpassed box office earnings for the second consecutive year in 2018.
Total home entertainment spending grew by 11.5 percent last year, reaching $23.3 billion. That’s more than twice the domestic box office revenue of the past twelve months, according to Box Office Mojo, illustrating how much Americans like to cuddle up on their own couch and binge a few episodes of their favorite show instead of going to an actual movie theater.